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STOP IT, TRACK IT AND GET IT - Renewed drive to stop illicit Financial Flows from Africa

Submitted by admin
on Mon, 12/28/2015 - 13:46

Illicit Financial Flows (IFF) from Africa are depriving the continent of almost US$50 billion annually. This was revealed in a roundtable discussion at the UN Headquarters in New York, by representatives of international development institutions including the NEPAD Agency and the UN Economic Commission for Africa (UNECA)

The discussion chaired by Ambassador Segun Apata, Chairperson of Coca Cola Nigeria, heard that existing estimates put IFF from Africa between 1970 and 2008 at nearly US $900 billion.

Ambassador Apata is part on an eight-member level high panel appointed by the African Union and UNECA which is also sponsoring the research. The panel is chaired by former South African President Thabo Mbeki. The Report attributes the highest percent of illicit flows at 60%, to commercial transactions - through multinational corporations. Criminal activities such as trade in drugs, weapons and people amount to 35%, with bribery and embezzlement making up only 5%.

NEPAD Chief Executive Officer Dr Ibrahim Mayaki said illicit flow of finances from Africa is an indication of a deficit in proper governance of resources. Dr Mayaki said public education is very important so that citizens are aware of what goes on as well as the impact of these flows. He said the study is part of efforts by the African Union to improve ownership and governance of resources.

The Report cites trade mis-invoicing; transfer pricing; investment-related transactions and offshore financial and banking centres and tax havens as some of the main channels for these illegal flows. UNECA has coined the phrase: Stop it, Track it and Get it as part of the campaign to stop these crimes.

The development impact of these illicit flows has resulted in loss of tax revenues, damage to economic potential and weakening of governance.

The high level panel is conducting country and sub-regional consultations with international actors and is expected to submit the final Report by March 2014.